A claim for breach of statutory duty was out of time because the statutory amendment prescribing the relevant limitation period was found not to operate retrospectively, however the negligence claim (which was not out of time) ultimately succeeded, leaving the body corporate exposed to the plaintiff’s claim.
In issue
- The issue central to the claim was whether the body corporate acted reasonably and promptly in arranging the repairs to the failed waterproofing. The secondary issue was whether the claim for breach of statutory duty was statute barred.
- On 1 July 2025, section 106(6) of the Strata Schemes Management Act 2015 (NSW) (the Act) was amended to extend the limitation period to bring claims for a breach of the statutory duty to properly maintain common property from 2 years to 6 years. The Court had to consider whether this amendment operated retrospectively. Specifically, the question arose as to whether the amendment was procedural in nature, or alternatively, whether it affected a party’s rights or obligations and thereby enlivened the presumption against the retrospective operation of an amendment.
The background
The claim centred around claims in negligence and breach of statutory duty in circumstances where a unit contained in a strata scheme suffered damage from water ingress caused by the failure of waterproofing of the balcony above it.
John Goubran & Associates Pty Ltd (the plaintiff) owned a unit in a building in Burwood, New South Wales. The Owners – Strata Plan 57150 (the defendant) was the body corporate which was responsible for the management of the building’s strata scheme under the Act. In September 2021, the plaintiff became aware of significant water ingress to the unit caused by failed waterproofing of the balcony of the unit above. In November 2021, the plaintiff notified the defendant of the ingress. In April 2022, the defendant obtained an expert report which identified that the waterproofing on the balcony had failed. In December 2024, the defendant finished the required repairs to the balcony, some years after the initial notification. Claims were commenced by the plaintiff on 14 July 2025 (the negligence claim having been commenced prior, and the added breach of statutory duty claim being added by way of amended statement of claim on 14 July 2025).
The plaintiff alleged that it was unable to rent the unit out from December 2021 to December 2024. The plaintiff sought damages from the defendant in respect of the foregone rent during that period.
The decision at trial
The plaintiff submitted that the amendment to section 106(6) of the Act was procedural in nature and therefore not subject to the presumption against the retrospective operation of an amendment.
Cole DCJ decided that the limitation period under section 106(6) of the Act does not operate retrospectively. His Honour applied the High Court decisions of Rodway v R (1990) 169 CLR 515 and Maxwell v Murphy (1957) 96 CLR 262, which are authority for the argument that where a statute affects a party’s existing rights or obligations, it should not be applied retrospectively unless it is required by the express language of the statute or by necessary implication.
His Honour found that the amendment to the Act affected existing rights and obligations, specifically the defendant’s right to be free of a claim (characterised by the High Court in Rodway). Therefore, the amendment was not merely procedural in nature. On that basis, the extended limitation period of 6 years under the Act did not apply and the pre-amendment limitation period of 2 years applied.
The plaintiff filed its claim for breach of statutory duty on 14 July 2025 and nominated December 2021 as the time for which the bringing of proceedings should be calculated. Therefore, under the pre-amended Act, the time for the bringing of proceedings expired in December 2023 and the plaintiff’s claim for breach of statutory duty was time barred.
Nonetheless, the plaintiff’s common law claim for negligence was not out of time and ultimately succeeded in its claim for negligence against the defendant. His Honour held that the defendant breached its common law duty of care to maintain the common property of the building. His Honour found that the defendant should have taken steps to repair the balcony within weeks of obtaining the April 2022 report. Instead, it took the defendant over 14 months to finalise the scope of works for the repairs due to 'long and unexplained delays', and the repairs were completed thereafter in December 2024.
His Honour awarded damages to the plaintiff in respect of lost rent from May 2022 (when His Honour found the repairs could have been completed) to December 2024 (the date of the practical completion of the repairs).
Implications for you
This decision underscores the importance of body corporates acting promptly when faced with such situations. Importantly, had the defendant made the necessary arrangements for repairs by April 2022 (some four to five months after being placed on notice of the issue), it is likely that the plaintiff’s claim for negligence would have failed.
It otherwise serves as a timely reminder of the importance of properly considering limitation periods, not that it had any practical implication in this instance.
John Goubran & Associates Pty Ltd v The Owners – Strata Plan 57150 [2026] NSWDC 9
